SHRIPRAKASH RAMPREM VISHWAKARMA, MUMBAI V. A.C.I.T. - 19(1), MUMBAI

ITA 8864/MUM/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71305 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-09-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 13-08-2013
• Assessment Year: 2003-2004
• Appeal Filed On: 30-12-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: T ROUMUAN PAITE
• Assessee Lawyers: P R TOPRANI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E , MUMBAI BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 8864/MUM/2011 ASSESSMENT YEAR: 2003-04 SHRI PRAKASH RAMPREM VISHWAKARMA 15, VISHWAKARMA BHAVAN, JAWAHAR NAGAR, SAIBABA ROAD, KHAR (EAST), MUMBAI-. 400 051 PAN :AACPV 4802 D VS. ACIT-19(1) 3 RD FLOOR, R. NO. 10-A WING, MITTAL COURT, NARIMAN POINT MUMBAI- 400 021 (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P. R. TOPRANI RESPONDENT BY : SHRI T. ROUMUAN PAITE DATE OF HEARING : 13.08.2013 DATE OF PRONOUNCEMENT : 25.09.2013 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE ASSESSEE IN ARISES OUT OF THE ORDER OF THE LD.CIT(A) - 22, MUMBAI DATED 12.10.2011 CONFIRMING THE PENALTY LEVIED BY THE AO U/S 271(1)(C) OF THE INCOME TAX ACT FOR THE ASSESSMENT YEAR 2003 -04. 2. BRIEFLY STATED, THE ASSESSEE, AN INDIVIDUAL ENGA GED IN THE BUSINESS OF INTERIOR DECORATION JOB WHILE DECLARING A TOTAL INCOME OF RS .21,22,350/- FOR THE YEAR UNDER CONSIDERATION, HAD TRANSFERRED OUTSTANDING LABOUR C HARGES PAYABLE FROM THE BOOKS OF M/S. ABHISHEK DECORATORS TO M/S. ABHISHEK FURNITURE S AMOUNTING TO RS.17,57,902/-, BOTH BEING PROPRIETORY CONCERNS OF THE ASSESSEE. TH E ASSESSEE HAD SUO MOTU WRITTEN OFF AN AMOUNT OF RS.10,00,000/- OUT OF LABOUR CHARG ES IN BOOKS OF ACCOUNTS AND ITA NO. 8864/MUM/2011 SHRI PRAKASH RAMPREM VISHWAKARMA ASSESSMENT YEAR: 2003-04 2 OFFERED THE SAME AS INCOME. THE BALANCE OF RS.7,57, 902/- WAS STILL SHOWN AS LIABILITY FOR OUTSTANDING LABOUR CHARGES PAYABLE. IN THE ASSE SSMENT FRAMED U/S 143(3), THE AO MADE SEVERAL ADDITIONS INCLUDING THE AMOUNT SHOW N AS PAYABLE ON ACCOUNT OF LABOUR CHARGES AS THE ASSESSEE COULD NOT ESTABLISH THE GENUINENESS OF THESE LABOUR CHARGES SHOWN AS PAYABLE. DURING THE COURSE OF THE FIRST APPELLATE PROCEEDINGS, THE LD.CIT(A) REMANDED BACK THE MATTER TO THE AO DURING WHICH AGAIN THE ASSESSEE COULD NOT PROVE THE GENUINENESS OF THE LABOUR CHARG ES AND ACCORDINGLY THE ADDITION OF RS.7,57,902/- WAS SUSTAINED BY THE LD.CIT(A) ALS O. CONSEQUENTLY, THE AO IMPOSED PENALTY OF RS.2,38,739/- U/S 271(1)(C) OF THE ACT, BEING 100% OF THE TAX SOUGHT TO BE EVADED ON THE INCOME IN RESPECT OF WHICH THE INC OME HAS BEEN CONCEALED/INACCURATE PARTICULARS OF INCOME HAVE BEE N FURNISHED. 3. ON APPEAL, THE LD.CIT(A) CONFIRMED THE PENALTY L EVIED BY THE AO AND THE RELEVANT FINDINGS ARE EXTRACTED HEREUNDER: I HAVE GONE THROUGH THE PENALTY ORDER, PERUSED THE SUBMISSIONS MADE BY THE APPELLANT AND ALSO DISCUSSED THE CASE WITH THE A.R. OF THE APPELLANT. THE UNDISPUTED FACT IS THAT THE LIABILITY OF RS.7,57,90 2/- WAS TAKEN OVER BY ONE PROPRIETORY CONCERN OF THE APPELLANT FROM ANOTHER P ROPRIETORY CONCERN, WHICH WAS ULTIMATELY LIABILITY OF THE APPELLANT AND HENCE WAS REQUIRED TO BE EXPLAINED BY HIM BEFORE ASSESSING OFFICER DURING TH E ASSESSMENT PROCEEDINGS, BEFORE A.O. DURING REMAND PROCEEDINGS AND BEFORE CIT(A) DURING APPELLATE PROCEEDINGS. IT IS ALSO A FACT THA T ON ALL THESE THREE OCCASIONS THE APPELLANT FAILED TO EXPLAIN THAT THE LIABILITY SHOWN WAS GENUINE. IN SUCH A SITUATION THERE IS NO SCOPE FOR OFFERING ANY EXPLANATION OF LETTING DOWN BY CHARTERED ACCOUNTANT OR THE PROPER MAINTENA NCE OF BOOKS OF ACCOUNTS. NONE OF THE DECISIONS RELIED UPON BY THE APPELLANT RELATE TO THE ISSUE UNDER CONSIDERATION. IN CLAUSE (A) OF EXPLANA TION (1) TO SECTION 271(1)(C) IT IS CLEARLY MENTIONED THAT WHERE IN RES PECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON U NDER THIS ACT, SUCH PERSON FAILS TO OFFER AN EXPLANATION THEN, THE AMOU NT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME OF SUCH PERSON AS A RESU LT THEREOF SHALL, FOR THE PURPOSE OF CLAUSE (C) OF THIS SUB SECTION BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED . THIS CLAUSE SQUARELY APPLIES TO THE CASE OF THE APPELLANT SINCE DESPITE HAVING THREE OPPORTUNITIES AVAILABLE TO HIM, APPELLANT FAILED TO OFFER EXPLANA TION WITH REGARD TO THE GENUINENESS OF LIABILITY CLAIMED. IN VIEW OF THESE FACTS AND THE LEGAL POSITION AS MENTIONED ABOVE, I AM OF THE CONSIDERED OPINION THAT THE PENALTY U/S 271(1)(C) OF RS.2,38,739/- HAS RIGHTLY BEEN IMPOSED BY THE AO WHICH IS UPHELD. AGGRIEVED BY THE IMPUGNED ORDER, THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO. 8864/MUM/2011 SHRI PRAKASH RAMPREM VISHWAKARMA ASSESSMENT YEAR: 2003-04 3 4. HAVING HEARD BOTH THE SIDES AND PERUSED THE MATE RIAL ON RECORD, IT IS PERTINENT TO MENTION THAT THE ONUS IS ON THE ASSESS EE TO PROVE THAT THE LIABILITY OF RS.7,57,902/- TAKEN OVER BY ONE PROPRIETORY CONCERN OF THE ASSESSEE FROM ANOTHER PROPRIETORY CONCERN IS ULTIMATELY THE LIABILITY OF THE ASSESSEE AND THE SAME IS GENUINE. IT IS OBSERVED THAT DURING THE ASSESSMENT/ REMAND/APPELLATE/PENALTY PROCEEDINGS, THE ASSESSEE HAS NOT DISCHARGED THE SA ID ONUS NOR HAS EXPLAINED THAT THE LIABILITY SHOWN IS GENUINE. IN VIEW OF THAT MAT TER, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD.CIT(A) CONFIRMING THE PENALTY L EVIED BY THE AO FOR THE REASONS CITED BY HIM IN HIS FINDINGS REFERRED TO IN PARA 3 AS AFOREMENTIONED AND THE SAME IS UPHELD. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY 25 TH OF SEPTEMBER, 2013. SD/- SD/- (P.M. JAGTAP) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 25.09.2013. *SRIVASTAVA COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR E BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.